Aims to become one of the top 10 global players in the field
Gulf Extrusions, a leading extruder in the Gulf and a division of the multi-billion well-diversified Al Ghurair Group, is planning to near double its capacity, a top company official said. "The company is aiming to become one of the top 10 extruders in the world in terms of quality, volume and innovation.
It is targeting to near double its capacity to 125,000 metric tonnes (MT) by 2012 from 65,000MT currently," Modar Al Mekdad, general manager, Gulf Extrusions, told The Business Weekly.
The company's plan to near double its capacity is not just focused on the construction sector and will be directed to furthering its exports to Africa, Asia and new regions. The company is close to achieving the Dh1 billion turn over mark by the end of this year. Gulf Extrusions, established in 1976, has six extrusion lines with a capacity of 65,000MT per year and currently, the facility is running at 75 per cent capacity.
Plant in Qatar
For the time being, the company does not plan to add any more lines or capacity to its facility here but is setting up a new plant in Qatar.
"We have sales offices in Europe, the US, as well as in Saudi Arabia and we are planning to open a new sales office in Delhi, India, by the third quarter of this year to provide technical support to the parent company," said Mekdad. Gulf Extrusions has been reporting healthy growth rates of over 35 per cent over the last two years and this year, it expects to grow by 25 per cent. "Our growth rate is well planned as we are very selective and do not pick up all the jobs in the market," he added.
"We have a business plan where Gulf Extrusions will become one of the top 10 extruders worldwide (excluding China)." According to Mekdad, the main challenge the extruders are facing is the volatility of aluminium prices. Aluminium prices depend on global economic demand and supply.
Price volatility
"Volatility in prices affects us because nearly 80 per cent of the cost is from aluminium. When prices spike, we have to pass it to our customers. This will have a direct effect on the real estate sector because 90 per cent of the aluminium here is being used for this sector, leading to a further hike in the cost of construction," he explained.
Other challenges include over-dependency on the construction sector and a haphazard expansion in the extruding capacity without looking at the supply and demand. "The problem is that all the extruders are expanding capacity without looking at the supply and demand. What is needed is a planned expansion in capacity of extrusion," he said.
Gulf Extrusions has undertaken several prestigious projects in the UAE and the region.
"We have supplied our products for the Burj Dubai project, Giorgio Armani Hotel, nearly 80 per cent of the towers in the UAE, The Palm Island, Dubai Business Bay, several towers on Shaikh Zayed Road, Arabian Ranches, Jumeirah Lake Towers and Jumeirah Beach Residences, among others," Mekdad said.
By Vinod Kumar PK
© The Business Weekly 2008
